The Solar Energy Corporation of India’s (SECI’s) latest auction for 2 GW interstate transmission system (ISTS)-connected solar projects (Tranche IX) witnessed a record low bid of Rs 2.36 per kWh. This tariff was quoted by Spanish developer SolarpackCorporacionTecnologica SA for 300 MW of capacity.Other successful bidders under the auction include ReNew Power, which secured 400 MW of project capacity at a tariff of Rs 2.38 per kW; Italy’s Enel, French firm Eden Renewables, the Singapore business of German developer Ibvogt secured 300 MW of capacity eachat a tariff of Rs 2.37 per kWh and Ayana Renewable Power secured 300 MW of capacity at a tariff of Rs 2.38 per kWh; Amp Energy secured 100 MW of capacity at a tariff of Rs 2.37 per kWh.
Tata Power Renewable Energy quoted a tariff of Rs 2.39 per kWh for 600 MW of projects, and O2 Power SG Private Limited quoted Rs 2.46 per kWh for 400 MW, although they did not win any capacity.
The tender garnered surprisingly low tariff quotes. There are multiple reasons for this to happen. One of the reasons is that the exemption of basic customs duty for the projects. Another reason is freedom from applicability of the Approved List of Models and Manufacturers clause. There is also a common industry sentiment that the price of solar modules will dip. The decrease in the income tax rates for new companies is another reason for the low tariffs.